As the apartment market nationwide is anticipating a supply peak, market-by-market supply trends vary, noted RealPage in a recent analysis.
“Ultimately what's happening in your city is going to tell you more about the near-term than the nation at large,” said the software firm. “Macro and micro go hand in hand, after all.”
About half of the nation’s largest metros are at least six months to a year away from hitting peak supply, including several Southern California markets, according to RealPage. An outlier is urban Los Angeles, where delays could push its supply peak into 2026 if not 2027.
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A dozen major US metros have already hit peak supply and are on a downward supply slope, the analysis said. Salt Lake City is an example of a market where peak construction activity accounted for more than 10% of all existing inventory.
Meanwhile, an urban supply wave in Chicago is quickly subsiding after peak supply in the urban core is expected to fall from 4,100 units in the first quarter of 2024 to 2,800 units by the first quarter of 2025. In Chicago’s suburbs, supply peaked in 2023 but should remain consistent at least through 2025.
A handful of markets are approaching peak supply, including a noteworthy cluster in the Southeast that includes Central Florida, Atlanta and Tennessee. South Florida and the Carolinas will likely experience their supply peak in a few more quarters. RealPage said Jacksonville and Nashville are worth watching in terms of supply trends, as they have had some of the most aggressive development pipelines on a percentage growth basis in recent years.
Delays may push Seattle’s supply peak into next year, but new start trends in the market indicate the peak will come sooner than later. Texas and the North Carolina trio should peak in the first half of 2025 but are likely to have a slower return to normal revenue growth levels due to volume.
New York may prove to be the last market to peak based on its backloaded 2025 deliveries, said RealPage. A few neighborhoods may even peak as late as 2028.
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Kristen Smithberg
Kristen Smithberg is a Colorado-based freelance writer who covers commercial real estate, insurance, benefits and retirement topics for BenefitsPRO and other industry publications.
